A-Level Economics A: CASE STUDIES Flashcards
Theme 1: Free Market and Command Based Economies
What is a good example of a free-market economy?
According to the Index of Economic Freedom, Hong Kong is ranked as the most economically free market in the world.
Theme 1: Free Market and Command Based Economies
Why is Hong Kong referred to as a free market economy?
This is due to its low tax rates, relaxed regulations on businesses, and highly capitalist economic system.
Theme 1: Free Market and Command Based Economies
What are good examples of command-based economies?
The five countries with the least economic freedom in the world are North Korea, Venezuela, Cuba, Congo and Eretria. North Korea and Cuba have the most command-based economy in the world.
Theme 1: Free Market and Command Based Economies
What do command-based economies usually suffer from?
But suffers from food shortages, high inflation, corruption and high levels of unemployment.
Theme 1: Free Market and Command Based Economies
What is an example of the consequences of command-based economies in North Korea?
In North Korea, for example, 20% of children are affected by malnutrition (lack of healthy food). As a result, on average a North Korean is shorter than a South Korean (mix economy) man.
Theme 1: Negative Externalities
What is an example of a Negative Production Externality in the Gulf of Mexico?
In 2010, an underwater BP well spilled over 35,000 barrels of oil in the Gulf of Mexico.
Theme 1: Negative Externalities
What were the financial costs on BP for the underwater spillage?
It cost BP $4 billion to contain and clean up the mess and another $5 billion in penalties.
Theme 1: Negative Externalities
What were the environmental costs of the underwater spillage?
Between May 2010 and November 2012, more than 1,700 sea turtles were found stranded. This is compared to 240 normally found a year. In addition, 930 dolphins and whales were discovered stranded during the period from February 2010 to April 2013. Only 20 a year are usually found in this state.
Theme 1: Negative Externalities
What were the economic costs of the underwater spillage?
The oil spill disaster harmed the fisheries sector. It affected the cellular function of the killifish, a common baitfish at the base of the food chain. It harmed the development of larger fish such as mahi-mahi and reduced the number of juvenile bluefin tuna by 20%.
Theme 1: Negative Externalities
What is an example of a Negative Production Externality in Bangladesh’s textiles industry?
The textile industry in Bangladesh has been a great engine for boosting economic growth in the country.
